TAM SAM SOM Calculator

TAM (Total Addressable Market) is the total revenue opportunity for a product. SAM (Serviceable Available Market) is the portion of TAM your business model can target. SOM (Serviceable Obtainable Market) is the realistic share you can capture given your current resources and competition.

Top-down starts with total industry size and narrows using percentage filters for your target segment and obtainable share. Bottom-up starts with the number of potential customers, multiplies by average revenue per customer, then applies market share assumptions. Bottom-up is generally more credible for investor presentations.

Investors use TAM SAM SOM to evaluate whether a market is large enough to support a venture-scale outcome. A large TAM shows opportunity, SAM shows strategic focus, and SOM shows near-term realism. Teams that can clearly articulate all three demonstrate market understanding.

TAM estimates are directional, not precise. The goal is to show you understand the market's scale and have a defensible methodology. Using multiple approaches (top-down and bottom-up) and cross-referencing industry reports strengthens credibility.

SOM typically ranges from 1% to 5% of SAM for early-stage startups, depending on the competitive landscape and go-to-market strategy. Claiming more than 10% of SAM in year one is usually unrealistic unless you are entering a niche with very few competitors.